The real question with the Regional Greenhouse Gas Initiative is asked in this podcast: How did it go so wrong?
The Northeastern US carbon dioxide trading system was proposed in 2003, less than a decade ago but a lifecycle ago in climate change politics. At the time, dealing with global warming was a top priority, and Republicans were seeking market solutions to what was perceived as a huge threat.
No one saw the massive recession, the gains in energy efficiency or the deployment of huge amounts of new natural gas supply from significantly more productive domestic wells. What the organizations that put together RGGI could have seen, as this podcast makes clear, is that the market was poorly designed. There were too many credits given out to emitters, and entire sections of the economy, largely industrial firms, were exempted from participation.
The states of the Northeastern US wanted to be good, just not yet. The lack of consensus on energy and climate change issues that clouds the future of the climate change and carbon emissions debate today is in part an offspring of the failure of the RGGI market.
The RGGI market in emissions for carbon dioxide continues to straggle on despite widespread forecasts of its imminent demise. With New Jersey threatening to pull out of the system, analysts wonder how far behind the other participant states can be. Read the full story on Breaking Energy here.